19 Fla. L. Weekly Supp. 136b

Online Reference: FLWSUPP 1902MILOInsurance — Personal injury protection — Coverage — Where legislature expressed intent that 2008 PIP statute apply retroactively, but application of 2008 statute to calculate benefits adds new legal consequences to terms agreed upon at time of issuance of policy, which provided that payment of benefits would be in accordance with PIP statute “as amended,” retroactive application of statute is not constitutional — Policy reference to PIP statute “as amended” refers to past amendments to PIP statute and does not incorporate future amendments to PIP statute into policy — Even if “as amended” language was intended to incorporate future changes to PIP statute into policy, changes would be applicable only to extent that they do not conflict with specific method of calculating benefits provided in policy

CENTRAL CHIROPRACTIC CARE, INC., a Florida corporation, (A/A/O Lubin Milord), Plaintiff, vs. MERCURY INSURANCE COMPANY OF FLORIDA, Defendant. County Court, 20th Judicial Circuit in and for Collier County, Civil Division. Case No. 10-1795-CC. October 17, 2011. Rob Crown, Judge.

ORDER GRANTING PLAINTIFF’S MOTION FORPARTIAL SUMMARY JUDGMENT AND DENYINGDEFENDANT’S MOTION FOR SUMMARY JUDGMENT

THIS CAUSE came before the Court on Plaintiff’s Motion for Partial Summary Judgment and Defendant’s Motion for Summary Judgment. The instant action is Plaintiff’s attempt to collect on an insurance policy following a motor vehicle accident. Plaintiff moves for partial summary judgment asserting that the 2008 P.I.P. fee schedule does not apply retroactively. The policy was issued on August 24, 2007; the automobile accident occurred in February 2008; and Defendant’s application of the 2008 P.I.P. fee schedule resulted in reduced benefits to the claimant. Defendant moves for summary judgment asserting that all P.I.P. benefits have been paid pursuant to the 2008 fee schedule. Both motions have been consolidated for purposes of this Order because each turns on the retroactive application of the 2008 P.I.P. fee schedule. Having considered the evidence presented, the arguments of counsel, and the applicable law, and otherwise being fully advised in the premises, the Court finds as follows:The Standard for Retroactive Application

“[I]n determining if a statute is retroactive, two factors are to be considered. The first factor is whether the statute itself expresses an intent that it apply retroactively, and if so, the second factor is whether retroactive application is constitutional.” Florida Insurance Guaranty Association, Inc. v. Devon Neighborhood Association, Inc., 67 So.3d 187 (Fla. 2011) [36 Fla. L. Weekly S311a].The First Factor: Legislative Intent

The statute in question is F.S. §627.736, which is part of the Florida Motor Vehicle No-Fault Law. When this law was amended in 2008, the Legislature provided, “Any personal injury protection policy in effect on or after January 1, 2008, shall be deemed to incorporate the provisions of the Florida Motor Vehicle No-Fault Law, as revived and amended by this act.” F.S. §627.7407(2). By including policies already in effect by 2008, the Legislature expressed an intent that the statute in question apply retroactively. See Geico Indemnity Co. v. Physicians Group, LLC, 47 So.3d 354 (Fla. 2 DCA 2010) [35 Fla. L. Weekly D1850a].¹ Therefore, this Court must next consider whether the retroactive application of the instant statute is constitutional.The Second Factor: Constitutionality

Substantive Changes

One canon of statutory construction is that “retroactivity is not favored in the law.” Bowen v. Georgetown Univ. Hospital, 488 U.S. 204 at 208 (1988). Further, in Landgraf v. USI Film Products, 511 U.S. 244 (1994) the United States Supreme Court wrote, “the court must determine whether the new statute would have retroactive effect, i.e., whether it would impair rights a party possessed when he acted, increase a party’s liability for past conduct, or impose new duties with respect to transactions already completed.” Landgraf at 280. Moreover, if a statute has a substantive effect, then the Bowen presumption against retroactivity would preclude such an application. The Florida Supreme Court cited the United States Supreme Court and reached the same conclusion. “[T]he court must ask whether the new provision attaches new legal consequences to events completed before its enactment.” Metro. Dade County v. Chase Fed. Hous. Corp., 737 So.2d 494 (Fla. 1999) [24 Fla. L. Weekly S267a] quoting Landgraf. Therefore, based on Landgraf and Metro. Dade County, this Court must determine whether application of the 2008 version of Florida Statute §627.736 to calculate benefits payable to Plaintiff adds new legal consequences to the terms agreed upon at the time the insurance policy was issued.

“As Amended”

Both sides presented a copy of the policy in question to the Court², and both parties agreed at the hearing that the Court may rely upon the policy in rendering this decision. The insurance policy provides, in pertinent part, “We will pay to or on behalf of the insured person the following benefits. Payments will be due . . . in accordance with the Florida Motor Vehicle No-Fault Law, as amended, for . . .eighty percent (80%) of all reasonable expenses for medically necessary . . . services . . . ” Insurance Policy, Part II — Personal Injury Protection — Coverage P, p.7. Both parties cited trial court opinions which appear to be split on the interpretation of the “as amended” language in the insurance policy. Defendant argues that “as amended” refers to future changes in the law, and therefore, those changes are incorporated into the policy. For that reason, according to Defendant, retroactive application is not unconstitutional. On the other hand, Plaintiff argues that “as amended” refers to past changes, which means the parties did not agree to incorporate future changes into the policy. Therefore, retroactive application of an amendment that reduces benefits payable to Plaintiff is unconstitutional.

“Amended” is the “past tense conjugation of the verb amend.” www.websters-online-dictionary.org. Moreover, “amended” refers to changes that have already occurred. If one were to replace the word “amended” with the word “changed” in the policy, then the flaw in Defendant’s interpretation becomes apparent. “Payments will be due . . .in accordance with the Florida Motor Vehicle No-Fault Law, as changed.” According to Defendant, this provision actually means, “Payments will be due . . . in accordance with the Florida Motor Vehicle No-Fault Law, as changes in that law may occur in the future.” If the parties had intended to incorporate future changes, then they should have used this language themselves; what they cannot do is ask this Court to read that language into their contract when it does not exist, especially when the request comes from the drafter of the contract to the detriment of the adverse party. Therefore, this Court agrees with Plaintiff that “as amended” refers to past changes, and there is no indication that the parties agreed to the retroactive application of future changes in the fee schedule.

Even assuming “as amended” refers to prospective changes as argued by Defendant, the specific method for calculating payments articulated in the contract prevails over general, speculative language that contemplates the possibility of changes in the future. The parties contracted for a specific method of calculating payments as articulated in the policy, specifically eighty percent (80%) of all reasonable expenses for medically necessary services. Therefore, even if they intended to incorporate future changes, then those changes would be applicable only to the extent that they do not conflict with the specific method of calculating payments provided in the contract.

Reduced Benefits

It is undisputed that the insurance policy in question was issued before January 1, 2008.³ It is undisputed that Defendant calculated payments based on the fee schedule set forth in F.S. §627.736(2008).⁴ It is undisputed that the benefits paid to Plaintiff were reduced because of Defendant’s application of the 2008 fee schedule.⁵ The parties did not incorporate the 2008 fee schedule into the insurance policy. The 2008 fee schedule conflicted with the specific method of calculating payments articulated in the policy. Defendant’s use of the 2008 fee schedule to calculate payments to Plaintiff added new legal consequences to the terms expressly agreed upon by the parties and was, therefore, an unconstitutional retroactive application of the amended version of F.S. §627.736. It is therefore

ORDERED AND ADJUDGED that Plaintiff’s Motion for Partial Summary Judgment is granted. It is further

ORDERED AND ADJUDGED that Defendant’s Motion for Summary Judgment is denied.

__________________

¹“Because the facts are not before us, we do not address whether the 2008 statute retroactively applies to a policy that was issued prior to but was ‘in effect on’ January 1, 2008.” Geico. However, the Geico Court rephrased the certified question and provided in part, “the 2008 version of the Florida Motor Vehicle No-Fault Law . . . expressly applies to PIP policies ‘in effect on or after January 1, 2008′.” Moreover, the appellate court added “expressly applies” to the certified question, which certainly seems to support this Court’s conclusion that the statute itself expresses an intent to apply the 2008 fee schedule retroactively to policies already in effect by January 1, 2008.

²The policy is attached to Defendant’s motion as “Exhibit G,” a copy of which was also provided to the Court by Plaintiff at the hearing.

³Defendant’s Response to Supplemental Request for Admissions, ¶2.

⁴Defendant’s Response to Supplemental Request for Admissions, ¶1.

⁵Defendant’s Response to Supplemental Request for Admissions, ¶1.

* * *